Arizona’s hot weather may be wearing thin on the locals, but it appears to be attracting foreign buyers in residential real estate. California, Florida, Texas and Arizona, rank as the top four states, respectively for home purchases by foreign buyers. The sunshine factor in the top four is a strong indicator that warm weather likely plays a big role on where foreign home buyers choose to buy. Other factors include the location of friends and family, job and educational opportunities and proximity to the home country. Canadians make up the largest number of foreign homebuyers in the United States, followed by China, Mexico, India and the United Kingdom. Foreign buyers represent an important sector in Arizona’s real estate economy. On average, foreign buyers spend $499,000 on their real estate purchase, compared to $250,000 for domestic buyers. Given what we know and depending on the property for sale, it may be worth considering whether to market your residential property to potential buyers living beyond U.S. borders.
Before reaching out to potential buyers abroad, here are some things to consider:
Who is your foreign buyer?
The answer largely depends on what kind of property you have for sale. Statistics show Canadians make up nearly half the international homebuyers in Arizona, and they are mostly buying vacation homes or winter residences. They also show an increasing interest in condominium and apartment properties. Chinese buyers, on the other hand are purchasing single-family homes to be used as their primary residence. Another factor to consider is the health of the economies in the countries of potential foreign buyers. Knowing who, what and why foreign investors are buying in Arizona, helps you determine what the potential market is for your residential property, both domestically and internationally. When you know who your potential buyer is, you can focus or adjust your marketing strategy. It’s about working smarter, not necessarily harder.
Developing a marketing strategy
What degree you market to foreign buyers will depend on the volume of product you have to offer. However, regardless of whether you have a few units to sell in an infill project or you are looking to market dozens of houses in a whole housing development, you need to speak the local language. Have a smart, website that offers the option for translation into the local language. The site needs to be optimized for that market’s local search engine. For instance, China doesn’t Google, it uses Baidu, and its algorithms differ greatly from Google. Don’t underestimate the importance of this. Search engines in foreign countries literally speak a different language. You could waste a lot of money and time by not making sure your website is finding its way to your potential buyers. For higher volume offerings, you should also consider engaging a local agent who can personally meet with potential buyers and help develop leads. Offer incentives to your local agent to close deals. An empowered and motivated local agent will work much harder to market your properties than one without that authority. Agents with a much smaller inventory would do just as well to list the residences on websites that specialize in marketing homes globally and nationally. Consider consulting with an agent who specializes in selling homes to foreign buyers for ideas on what websites are the best fit for what you are selling.
Showcasing your property
Appearance is everything when it comes to marketing properties (particularly residential) to foreign buyers. This holds true for a builder developing and listing just one house or a whole community. Residential listings should appear on websites with numerous, clear pictures and videos. A potential buyer in another country is not physically available to tour the home or property in person. They will need professional photos and videos accompanied with a detailed information about the property. This is key to attracting a foreign buyer’s interest.
Closing the deal
Foreign buyers need help weaving their way through the process of buying a home in the United States. It can be daunting for someone who lives in this country, let alone a global buyer who may not even speak English. If they are not already working with a broker, your agent or sales person must be ready to provide their expertise and advisement. Connect them with top of the line inspectors, the best title agents, mortgage brokers, etc. Be the go-to for advisement and build your reputation for providing accurate information and good customer service.
Marketing residential properties to foreign buyers has a huge potential pay-off for builders, developers and individual sellers, but it can also be a colossal waste of time and marketing dollars if the proper leg work isn’t done. Builders, developers and realtors who take the time to understand the nature of globally marketing their properties and recognize where their listings would be most attractive, may find this shift of focus very rewarding.